DOE awards $18.7M BPA Call to Ernst & Young for Supply Chain Risk Management
Contract Overview
Contract Amount: $18,715,857 ($18.7M)
Contractor: Ernst & Young LLP
Awarding Agency: Department of Energy
Start Date: 2022-07-19
End Date: 2026-07-19
Contract Duration: 1,461 days
Daily Burn Rate: $12.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: THE PURPOSE OF THIS BPA CALL IS FOR FOLLOW-ON SUPPLY CHAIN RISK MANAGEMENT (SCRM) SUPPORT SERVICES FOR OCIO.
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20585
Plain-Language Summary
Department of Energy obligated $18.7 million to ERNST & YOUNG LLP for work described as: THE PURPOSE OF THIS BPA CALL IS FOR FOLLOW-ON SUPPLY CHAIN RISK MANAGEMENT (SCRM) SUPPORT SERVICES FOR OCIO. Key points: 1. Contract focuses on critical Supply Chain Risk Management (SCRM) for the Office of the Chief Information Officer (OCIO). 2. The contract duration of 1461 days (approx. 4 years) suggests a need for sustained support. 3. Ernst & Young, a large professional services firm, is the awardee. 4. The contract type is Time and Materials, which can pose cost control challenges if not managed closely. 5. The award was made under a Blanket Purchase Agreement (BPA) Call, indicating a pre-negotiated framework. 6. The specific NAICS code (541211) points to accounting services, which may be a subset of the broader SCRM support. 7. The contract is not set aside for small businesses, nor does it appear to have specific subcontracting requirements mentioned.
Value Assessment
Rating: fair
The total value of $18.7 million over approximately four years for SCRM support services appears reasonable for a large federal agency like the Department of Energy. However, without specific details on the scope of services and deliverables, a direct comparison to similar contracts is difficult. The Time and Materials (T&M) contract type introduces inherent risk for cost overruns if not meticulously managed and monitored. Benchmarking the value would require understanding the specific SCRM activities performed, such as risk assessments, policy development, or technology integration.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The presence of two bids indicates some level of competition, though the exact number of interested parties and the rigor of the evaluation process are not detailed. Full and open competition generally promotes competitive pricing and allows the government to select the best value offer.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining services at competitive prices and encourages a wider pool of qualified contractors to participate.
Public Impact
The primary beneficiary is the Department of Energy's OCIO, which will receive enhanced SCRM support. Services delivered are expected to bolster the security and resilience of the DOE's supply chain. The geographic impact is primarily within the District of Columbia, where the DOE headquarters is located, but SCRM can have national implications. The contract supports the federal government's broader cybersecurity and national security objectives.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Time and Materials contract type can lead to cost overruns if not closely monitored.
- Limited information on specific performance metrics makes it difficult to assess value for money.
- The NAICS code suggests accounting services, which may not fully encompass the breadth of SCRM.
- Only two bids were received, which might indicate limited market interest or a complex solicitation.
Positive Signals
- Awarded under full and open competition, ensuring a fair process.
- The contractor, Ernst & Young, is a reputable firm with extensive experience in professional services.
- The contract duration suggests a long-term commitment to addressing SCRM needs.
- The BPA Call mechanism implies a pre-existing framework agreement, potentially streamlining the acquisition process.
Sector Analysis
The federal IT services market is vast and highly competitive, with significant spending allocated to cybersecurity and risk management. Supply Chain Risk Management (SCRM) is a critical component of this sector, focusing on identifying and mitigating threats within the complex networks of vendors and suppliers that support government operations. This contract fits within the broader trend of agencies investing in robust SCRM capabilities to protect sensitive data and critical infrastructure. Comparable spending benchmarks would depend on the specific services rendered, but agencies often allocate tens to hundreds of millions annually for comprehensive cybersecurity and risk management solutions.
Small Business Impact
This contract was not set aside for small businesses, and there is no explicit mention of small business subcontracting requirements in the provided data. This means that opportunities for small businesses to participate in this specific contract are likely limited to direct subcontracting if Ernst & Young chooses to engage them. The absence of a set-aside or subcontracting goals means this award does not directly contribute to the government's small business contracting goals.
Oversight & Accountability
Oversight for this BPA Call would typically fall under the Department of Energy's contracting officers and program managers responsible for OCIO support. The Time and Materials contract type necessitates rigorous monitoring of labor hours and costs to ensure adherence to the contract ceiling and prevent overspending. Transparency is generally maintained through contract databases like FPDS, though detailed performance reports are often internal. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise.
Related Government Programs
- Federal Supply Chain Risk Management Programs
- Department of Energy Cybersecurity Initiatives
- Office of Management and Budget (OMB) Cybersecurity Directives
- IT Services and Support Contracts
- Blanket Purchase Agreements (BPAs)
Risk Flags
- Time and Materials Contract Type
- Limited Competition (2 Bids)
- Potential Scope Creep in SCRM
Tags
it, defense-industrial-base, supply-chain-risk-management, ernst-&-young-llp, department-of-energy, district-of-columbia, bpa-call, time-and-materials, full-and-open-competition, professional-services, cybersecurity, risk-management
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $18.7 million to ERNST & YOUNG LLP. THE PURPOSE OF THIS BPA CALL IS FOR FOLLOW-ON SUPPLY CHAIN RISK MANAGEMENT (SCRM) SUPPORT SERVICES FOR OCIO.
Who is the contractor on this award?
The obligated recipient is ERNST & YOUNG LLP.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $18.7 million.
What is the period of performance?
Start: 2022-07-19. End: 2026-07-19.
What specific Supply Chain Risk Management (SCRM) services are included under this BPA Call?
The provided data indicates the BPA Call is for 'follow-on Supply Chain Risk Management (SCRM) support services for OCIO.' While the exact scope is not detailed, SCRM typically encompasses activities such as identifying critical components and services, assessing risks associated with suppliers and vendors, developing mitigation strategies, implementing security controls throughout the supply chain, and monitoring for emerging threats. For the Department of Energy's OCIO, this could involve ensuring the integrity of hardware, software, and services procured for its IT infrastructure, protecting against counterfeit parts, and safeguarding against foreign influence or espionage risks within the technology supply chain. The specific deliverables, performance metrics, and reporting requirements would be detailed in the underlying BPA and the individual call order.
How does the $18.7 million value compare to similar SCRM contracts within the federal government?
Benchmarking the $18.7 million value requires a detailed understanding of the specific SCRM services rendered, the duration, and the agency's size and complexity. Federal SCRM contracts can range significantly. For instance, large-scale cybersecurity and risk management programs for agencies like the Department of Defense or NASA can run into hundreds of millions of dollars over several years. Smaller, more focused SCRM support for a specific program or office might be in the single-digit millions. Given that this is for the DOE's OCIO and spans approximately four years, $18.7 million suggests a substantial, but not exceptionally large, investment. It aligns with agencies seeking dedicated, expert support for a critical function like SCRM, especially considering the potential impact of supply chain vulnerabilities on national security and energy infrastructure.
What are the potential risks associated with a Time and Materials (T&M) contract for SCRM support?
Time and Materials (T&M) contracts, like the one awarded to Ernst & Young, carry inherent risks for the government, primarily related to cost control. In a T&M arrangement, the contractor is reimbursed for the actual cost of labor (at specified hourly rates) and materials, plus a fixed fee or profit. The primary risk is that the contractor may not have a strong incentive to control costs or complete the work efficiently, as their profit is tied to the hours worked and materials used. This can lead to cost overruns if the scope of work expands, if labor hours are not diligently tracked and managed, or if inefficiencies arise. For SCRM support, where the scope can sometimes be fluid due to evolving threats, close government oversight, detailed task monitoring, and robust reporting are crucial to mitigate these risks and ensure the government receives good value for its investment.
What is the significance of Ernst & Young being awarded this contract, given their primary classification under NAICS 541211 (Offices of Certified Public Accountants)?
While Ernst & Young's primary classification is under NAICS 541211 (Offices of Certified Public Accountants), large professional services firms like EY often have diverse capabilities that extend far beyond traditional accounting. They operate extensive consulting divisions that provide a wide array of services, including cybersecurity, risk management, IT consulting, and strategic planning. Therefore, their classification under accounting does not preclude them from possessing the expertise and resources necessary for SCRM support. Federal agencies often leverage these large firms for their broad skill sets, established methodologies, and ability to deploy significant resources. The award likely reflects EY's demonstrated capabilities in SCRM consulting, risk assessment, and potentially IT security, rather than solely their accounting services.
What does the limited competition (2 bids) suggest about the market for SCRM support services at the DOE?
The fact that only two bids were received for this BPA Call, despite being awarded under full and open competition, could suggest several things about the market for SCRM support services at the Department of Energy. It might indicate that the specific requirements of the solicitation were highly specialized, complex, or perhaps narrowly defined, attracting only a few firms with the precise expertise. Alternatively, it could point to a limited number of large, capable contractors willing or able to compete for this particular type of work within the federal sector, especially if it involves significant security clearances or specific agency knowledge. It's also possible that the solicitation process itself, or the timing, may have deterred other potential bidders. While two bids still represent competition, it's on the lower end and warrants consideration regarding market depth and potential future competition levels.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Offices of Certified Public Accountants
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: 89303022QIM000028
Offers Received: 2
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Address: 1 MANHATTAN WEST, NEW YORK, NY, 10001
Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $19,505,093
Exercised Options: $19,505,093
Current Obligation: $18,715,857
Actual Outlays: $15,649,100
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $210,099
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: 89303018ACF000005
IDV Type: BPA
Timeline
Start Date: 2022-07-19
Current End Date: 2026-07-19
Potential End Date: 2026-07-19 00:00:00
Last Modified: 2026-03-17
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